Constructive remittance of foreign business profits upheld where payments in British India were made at the assessee's direction.

Payments made in British India at the assessee's direction were treated as constructive remittances of profits from the Jubbal State timber business because the profit had already accrued and been finally determined, and the surrounding circumstances showed that the purchaser acted as the assessee's agent. The Tribunal could presume that remittances received in British India from a foreign business were profits unless the assessee rebutted that inference. The assessee did not prove that the payments were capital in nature or made without his direction, so no real or substantial question of law arose for reference under the Indian Income-tax Act, 1922.

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Issues: Whether the amounts paid in British India at the purchaser's direction constituted constructive remittance of the assessee's profits from Jubbal State, and whether any real or substantial question of law arose for reference under the Indian Income-tax Act, 1922.

Analysis: The profit on the timber sale had accrued in the accounting year in which the sale took place, and that profit was finally determined. The Tribunal was entitled to presume that remittances received in British India from a foreign business represented profits unless the assessee disproved that inference. The assessee did not establish that the payments were capital remittances or that they were made without his direction. The payment to the creditor in British India and the payment to the assessee himself were, on the surrounding circumstances, properly treated as payments made through the purchaser as the assessee's agent and therefore as constructive remittances. In these circumstances, no substantial question of law arose from the Tribunal's order.

Conclusion: The payments were rightly treated as constructive remittances of profits, and the refusal to direct a reference was correct.

Ratio Decidendi: Where money payable abroad is paid in British India at the assessee's direction in circumstances showing agency, the payment may be treated as a constructive remittance of profits, and the statutory presumption that remittances from foreign business represent profits stands unless rebutted by the assessee.

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